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Idaho tax panel proposes collections upgrade

Idaho tax officials want the state to invest $5.2 million for a major computer upgrade in its collection system.

The Idaho Tax Commission plans to pitch the upgrade to lawmakers in January as an improvement that could pay for itself within a year, The Spokesman-Review reported Dec. 5.

Officials say the upgrade will allow the state to better pursue those who file fraudulent returns or owe tax lien debt.

In addition, the commission is working toward “a more open and transparent way of doing business and better communication within our own ranks,” Chairman David Langhorst said Dec. 4 at the commission’s annual meeting.

The request will go to lawmakers and Gov. C.L. “Butch” Otter for possible inclusion in the fiscal year 2014 state budget. If approved, the new system would take 18 months to reach full operation.

The proposal came as the four-member commission works to boost public confidence and employee morale. Nearly two years ago, then chairman Royce Chigbrow resigned amid allegations that he used his position to help a friend in a business dispute.

In his resignation letter to the governor, Chigbrow said he tried to do his best on behalf of every Idaho resident and treat taxpayers with respect, fairness and dignity.

In 2008, a longtime state auditor filed a 17-page whistleblower report contending that secret tax deals were letting influential taxpayers off the hook for millions of dollars. That complaint provoked other allegations from veteran commission workers.

In 2009, the Legislature unanimously passed a new law to end the practice of a single tax commissioner approving secret deals to excuse all or part of taxes owed.

Langhorst said the commission has far exceeded the requirements of that law.

“We assure that all four commissioners sign off on every decision and every settlement, regardless of size – even if they’re $50,” he said.

Commissioners also encourage discussion between auditors and the policy people in the department, he said.

A 2010 lawsuit filed by Rep. Shirley Ringo, D-Moscow, claimed influential taxpayers were getting reductions in their taxes over auditors’ protests, and that confidentiality rules were being used to keep the deals secret.

The lawsuit was dropped in 2011, after Chigbrow resigned.

Langhorst said that over the past three years, a compliance initiative that added auditors allowed the commission to collect $52 million in taxes that were owed but weren’t being collected. The computer upgrade could boost that amount, officials say.

“The problem is that our software is based on 10-year-old technology,” said Doreen Warren, revenue and operations division administrator.

If the current system, known as GenTax, isn’t modernized, it will become increasingly difficult to maintain and could hamper future tax collection efforts, Warren said.

 

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